Mumbai : State-run oil companies have served an ultimatum to the government that they will raise petrol prices by 9.6 rupees a litre if excise duty is not cut or they are not provided compensation for 49-crore rupees loss per day on fuel sale.

Indian Oil Corporation Chairman R S Butola said in New Delhi that the government should temporarily end deregulation and give subsidy to make up for the difference between cost of production and sale price. He said, alternatively, the government can cut the excise duty. The levy VAT or sales tax ranging from 15 per cent to 33 per cent too can be cut to avoid a price hike. He said, if the suggestions are not accepted, they would have no option but to increase the price of petrol with immediate effect.